Japan is in a funk. Too many sequels, too many character-based titles and not enough original games. Fumito Ueda is once again bucking that trend. The 39-year-old is working on his third game, The Last Guardian. The game tells the story of a young boy and a large bird-like animal named Trico. It's anything but typical.

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"I'm worried about the Japanese game industry going the same way as the movie industry," the soft-spoken Ueda tells Kotaku. During the years after World War II, the Japanese movie industry was flooded with engaging, creative films by talented filmmakers.

As the decades wore on, Hollywood's impact continued to get stronger and stronger, so much so that by the late 1980s, the Japanese film industry was a shell of its former self. Studios closed, and the focus shifted to television. According to Ueda, "Japanese audiences don't watch Japanese films." The concern now is that as Western games get bigger and bigger budgets, that they will be able to overrun Japanese games like Hollywood did with movies.

It's not that Ueda is only making games for Japanese players — nothing could be further from the truth. His games have a universal quality that at once makes them feel entirely Japanese and utterly international. "I play mostly Western games," he says.

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On the designer's desk, a copy of Fable II, signed by Peter Molyneux, is proudly displayed. His workspace is also covered in a dozen or so drained cans of zero calorie black Wonda coffee. "That's where the name Wander came from," jokes a Sony Japan employee, making a reference to how the character's name is written in Japanese ("Wanda"). On a box next to his desk are a couple of old Atari Lynx handhelds.

Ueda didn't originally want to become a game designer. Rather, his interests were in modern art. Graduating from the Osaka University of Arts, a school that claims Nintendo music composer Koji Kondo as an alumni, Ueda says he was drawn to the video game industry because they offered visual expression. "I tried out various different career paths," he says, "and found that video games enabled me to combine my interest in art, visual expression and computer graphics."

But with that strong background in art, does Ueda consider video games to be art? It depends on your definition of art, says Ueda. "There are usually two classifications of art: high art and low art," Ueda explains. High art, he believes, is art in the classical sense, while low art can encompass manga and movies. "But when you are talking about art, the word art, people tend to think you are talking about the first definition, which is a narrow definition," Ueda says. "So if we are using that definition, then I do not think video games are art." But, if we use the other definition that describes art for the masses, then Ueda believes that, of course, video games are art.

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Many players would disagree, saying that Ueda's games are Art with a capital A. With The Last Guardian, a game Ueda says has been in development for about the past three years or so, on the horizon for holiday 2011, all eyes are on him. "I don't feel any pressure," he says. "Actually, the only pressure I feel is towards the players who have enjoyed my games in the past." If The Last Guardian is anything like those previous games, Ueda and players can rest easy.